News Corp. Near Deal With Liberty to Swap Stake in DirecTV

News Corp. is nearing an agreement with Liberty Media to buy back Liberty's $11 billion stake in the media giant, The Wall Street Journal reported. In exchange, Liberty will get News Corp.'s 39% stake in satellite-TV firm DirecTV Group, as well as some cash and other assets.

Liberty Media told investors Wednesday that obtaining a majority stake in U.S. satellite television provider DirecTV Group would give it a powerful distribution outlet for its programming networks, according to Reuters.

Liberty has been in discussions to swap its estimated 20% voting stake in News Corp. for the Rupert Murdoch-run company's controlling stake in DirecTV.

A deal was struck privately by Liberty Chairman John Malone and Murdoch this week, the New York Times reported Thursday. Liberty will also receive three regional sports networks owned by News Corp.'s Fox and about $550 million in cash, the New York Times said.

The deal would effectively be a huge share buyback, with News Corp. retiring Liberty's 19% voting stake in News Corp. and its 15% non-voting stake, the Times reported.

Malone's Return to Distribution

Liberty Chief Executive Greg Maffei said at the UBS media and communications conference in New York that the discussions were continuing, but he gave no update on the progress, according to the Journal report. "We have a host of content assets that don't have the distribution muscle they used to have," Maffei said.

The Colorado-based company, controlled by cable pioneer Malone, owns the QVC cable television shopping network and the Starz Entertainment Group cable networks.

Since Malone divested ownership of TeleCommunications Inc., once the largest U.S. cable TV service provider, in the 1990s, he has quietly sought to recreate a cable TV and broadband empire outside of the United States.

A deal to acquire the majority stake in one of the biggest TV providers in the United States would signal Malone's return to the media distribution industry.

Liberty Media owns big stakes in other media and technology companies, including Time Warner Inc. and News Corp. -- a stake that threatens the Murdoch family's 30% voting stake in the company.

Murdoch and Malone have been in discussions over the most tax-efficient means to exchange those shares. Those talks have centered on trading News Corp.'s stake in DirecTV lately.